Transcription
Economics 5th Edition Hubbard Solutions ManualFull Download: tion-hubbard-solutions-manual/ContentsPart 1: IntroductionChapter 1 Economics: Foundations and Models1Appendix: Using Graphs and Formulas11Chapter 2 Trade-offs, Comparative Advantage, and the Market System25Chapter 3 Where Prices Come From: The Interaction of Demand and Supply43Chapter 4 Economic Efficiency, Government Price Setting, and Taxes69Appendix: Quantitative Demand and Supply Analysis76Part 2: Markets in Action: Policy and ApplicationsChapter 5 Externalities, Environmental Policy, and Public Goods97Chapter 6 Elasticity: The Responsiveness of Demand and Supply121Chapter 7 The Economics of Health Care147Part 3: Firms in the Domestic and International EconomiesChapter 8 Firms, the Stock Market, and Corporate Governance165Appendix: Tools to Analyze Firms’ Financial Information175Chapter 9 Comparative Advantage and the Gains from International Trade189Part 4: Microeconomic Foundations: Consumers and FirmsChapter 10 Consumer Choice and Behavioral EconomicsAppendix: Using Indifference Curves and Budget Lines to UnderstandConsumer BehaviorChapter 11 Technology, Production, and CostsAppendix: Using Isoquants and Isocost Lines to Understand Production and Cost 2015 Pearson Education, Inc.Full download all chapters instantly please go to Solutions Manual, Test Bank site: testbanklive.com209217233244
ivContentsPart 5: Market Structure and Firm StrategyChapter 12 Firms in Perfectly Competitive Markets267Chapter 13 Monopolistic Competition: The Competitive Model in a MoreRealistic Setting293Chapter 14 Oligopoly: Firms in Less Competitive Markets313Chapter 15 Monopoly and Antitrust Policy335Chapter 16 Pricing Strategy359Part 6: Labor Markets, Public Choice, and the Distribution of IncomeChapter 17 The Markets for Labor and Other Factors of Production373Chapter 18 Public Choice, Taxes, and the Distribution of Income401Part 7: Macroeconomic Foundations and Long-Run GrowthChapter 19 GDP: Measuring Total Production and Income421Chapter 20 Unemployment and Inflation441Chapter 21 Economic Growth, the Financial System, and Business Cycles469Chapter 22 Long-Run Economic Growth: Sources and Policies489Part 8: Short-Run FluctuationsChapter 23 Aggregate Expenditure and Output in the Short RunAppendix: The Algebra of Macroeconomic EquilibriumChapter 24 Aggregate Demand and Aggregate Supply AnalysisAppendix: Macroeconomic Schools of Thought511524537548Part 9: Monetary and Fiscal PolicyChapter 25 Money, Banks, and the Federal Reserve System561Chapter 26 Monetary Policy585Chapter 27 Fiscal Policy613Appendix: A Closer Look at the MultiplierChapter 28 Inflation, Unemployment, and Federal Reserve Policy 2015 Pearson Education, Inc.620645
ContentsvPart 10: The International EconomyChapter 29 Macroeconomics in an Open Economy667Chapter 30 The International Financial System691Appendix: The Gold Standard and the Bretton Woods System 2015 Pearson Education, Inc.697
PrefaceFeatures of this Instructor’s ManualEach chapter of this Instructor’s Manual contains the following elements:Chapter Summary: An overview of the main economic concepts covered.Learning Objectives: A list of the student learning goals listed at the beginning of each text chapter.Chapter Outline with Teaching Tips: Detailed descriptions of the economic concepts in the book, keyterm definitions, and teaching tip boxes. The teaching tip boxes include recommendations on how tointegrate key figures.Extra Solved Problems: Each chapter of the main text has a Solved Problem to support two of thechapter’s learning objectives. This Instructor’s Manual includes Solved Problems for the remaininglearning objectives. You can assign these extra Solved Problems as homework or present them duringclassroom lectures.Extra Economics in Your Life: Each chapter of the book opens and closes with a special feature entitledEconomics in Your Life that emphasizes the connection between the material and the students’ personalexperiences and questions. This Instructor’s Manual includes an extra Economics in Your Life for eachchapter to present in class.Extra Making the Connection: Each chapter of the main text has two or more Making the Connectionfeatures to provide real-world reinforcement of key concepts. This Instructor’s Manual includes extraMaking the Connections to present in class.Solutions to Review Questions and Problems and Applications: Each chapter of this Instructor’sManual includes solutions to all questions and problems in the main text: Solutions to the two Thinking Critically questions that accompany the An Inside Look newspaperfeature located at the end of each chapterSolutions to the end-of-chapter Review QuestionsSolutions to the end-of-chapter Problems and ApplicationsRevisions to the Digital Assets and to the Main TextIf you used Hubbard/O’Brien, Economics, fourth edition, here are a summary of the new digital assetsavailable and a Transition Guide, with page numbers, that shows the changes the authors made to themain text. Knowing about these changes will help you revise your current teaching notes and classpresentations. 2015 Pearson Education, Inc.
viiiPrefaceNew digital features located in MyEconLabMyEconLab is a unique online course management, testing, and tutorial resource. It is included with thee-text version of the book or as a supplement to the print book. Students and instructors will find thefollowing new online resources to accompany the fifth edition:Videos: There are approximately 100 Making the Connection features in the book that provide realworld reinforcement of key concepts. Each feature is now accompanied by a short video of the authorexplaining the key point of that Making the Connection. Each video is approximately two minuteslong and includes visuals, such as new photos or graphs, that are not in the main book. The goal ofthese videos is to summarize key content and bring the applications to life. Our experience is thatmany students benefit from this type of online learning.Concept Checks: Each section of every chapter concludes with an online Concept Check thatcontains one or two multiple choice, true/false, or fill-in questions. These checks act as “speedbumps” that encourage students to stop and check their understanding of fundamental terms andconcepts before moving on to the next section. The goal of this digital resource is to help studentsassess their progress on a section-by-section basis, so they can be better prepared for homework,quizzes, and exams.Animations: Graphs are the backbone of introductory economics, but many students struggle tounderstand and work with them. Each numbered figure in the text has a supporting animated versiononline. The goal of this digital resource is to help students understand shifts in curves, movementsalong curves, and changes in equilibrium values. Having an animated version of a graph helpsstudents who have difficulty interpreting the static version found in the printed text.Interactive Solved Problems: Many students have difficulty applying economic concepts to solvingproblems. The goal of this digital resource is to help students overcome this hurdle by giving them amodel of how to solve an economic problem by breaking it down step by step. Each Solved Problemis accompanied by a similar problem online, so students can have more practice and build theirproblem-solving skills. These interactive tutorials help students learn to think like economists andapply basic problem-solving skills to homework, quizzes, and exams. The goal is for students to buildskills they can use to analyze real-world economic issues they hear and read about in the news.Graphs Updated with Real-Time Data from FRED: Figure 7.5, “Spending on Health Care aroundthe World,” Figure 8.2, “Movements in Stock Market Indexes,” and Figures 9.1 and 9.3, both oninternational trade, are continuously updated online with the latest available data from FRED (FederalReserve of Economic Data), which is a comprehensive, up-to-date data set maintained by the FederalReserve Bank of St. Louis. Students can display a pop-up graph that shows new data plotted in thegraph. The goal of this digital feature is to help students understand how to work with data andunderstand how including new data affects graphs.Interactive Problems and Exercises Updated with Real-Time Data from FRED: Chapter 8,“Firms, the Stock Market, and Corporate Governance,” includes two real-time data exercises that usethe latest data from FRED. The goal of this digital feature is to help students become familiar withthis key data source, learn how to locate data, and develop skills in interpreting data. 2015 Pearson Education, Inc.
PrefaceTransition Guide: Hubbard/O’Brien 4th Edition versus the New 5th EditionChapter 1: Economics: Foundations and Models4e page 4e Content5e page320–21Why Are Some Doctors LeavingPrivate Practice?Inside Look: Doctors Moving Less,Retiring Later318–195e ContentNEW: Is the Private Doctor’s Office Going toDisappear?NEW Inside Look: Look into Your Smartphoneand say “Ahh”Chapter 2: Trade-offs, Comparative Advantage, and the Market System4e page 4e Content5e page 5e Content394243Managers Making Choices at BMWSolved Problem 2.1: Drawing aProduction Possibilities Frontier forRosie’s Boston BakeryMaking the Connection: FacingTrade-offs in Health Care Spending3740NEW Managers at Tesla Motors Face Trade-offsSolved Problem 2.1: Drawing a ProductionPossibilities Frontier for Tesla Motorsn/aMoved to 5e IM49NEW Making the Connection: ComparativeAdvantage, Opportunity Cost, and HouseworkNEW Making the Connection: Who Owns TheWizard of Oz?NEW Inside Look: What’s on the Horizon atMercedes-Benz5760–61Inside Look: Managers at GeneralMotors Approve Production of aPlug-in Cadillac60–61Chapter 3: Where Prices Come From: The Interaction of Demand and Supply4e page 4e Content5e page 5e Content697374778892–93The Tablet Computer RevolutionMaking the Connection: Are QuiznosSandwiches Normal Goods andSubway Sandwiches Interior Goods?69n/aNEW: Smartphones: The Indispensible Product?Moved to 5e IM73NEW Making the Connection: Are TabletComputers Substitutes for E-Readers?Moved to 5e IM74NEW Making the Connection: Coke and PepsiAre Hit by U.S. DemographicsMoved to 5e IM77NEW Making the Connection: Forecasting theDemand for iPhonesMoved to 5e IM88–89NEW Solved Problem 3.4: What Has Caused theDecline in Beef Consumption?New Inside Look: Google and Apple FaceDemand and Supply Concerns in the SmartphoneMarketMaking the Connection: The Agingof the Baby Boom GenerationMaking the Connection: Forecastingthe Demand for iPadsSolved Problem 3.4: High Demandand Low Prices in the LobsterMarket?Inside Look: Will Shortage ofDisplay Screens Derail ComputerTablet Sales?92–93 2015 Pearson Education, Inc.ix
xPrefaceChapter 4: Economic Efficiency, Government Price Setting, and Taxes4e page 4e Content5e page 5e Content101122–123Should the Government ControlApartment Rents?Inside Look: .and the RentControlled Apartment Goesto Actress Faye Dunaway!101122–123NEW: The Sharing Economy, Phone Apps, andRent ControlNEW Inside Look: Does the Sharing EconomyIncrease Efficiency?Chapter 5: Externalities, Environmental Policy, and Public Goods4e page 4e Content5e page 5e Content148Solved Problem 5.3150–151152162–163Inside Look: Pros and Cons ofTougher Air Pollution Regulationn/aMoved to 5e IMNEW Solved Problem 5.3: Dealing with theExternalities of Car DrivingNEW section: The End of the Sulfur DioxideCap-and-Trade SystemSee MyEconLab for current news articles,summaries, and questions for Chapter 5 onward.Chapter 6: Elasticity: The Responsiveness of Demand and Supply4e page 4e Content5e page 5e ContentMoved to 5e IM184–185 Making the Connection: Determining n/athe Price Elasticity of Demandthrough Market ExperimentsPrice Elasticity, Cross-PriceElasticity, and Income Elasticity inthe Market for Alcoholic BeveragesInside Look: Gasoline PriceIncreases Change ConsumerSpending Patterns, May StallRecovery186Heavily revisedn/aSee MyEconLab for current news articles,summaries, and questions.Chapter 7: The Economics of Health Care4e page 4e Content5e page5e Content205Small Businesses Feel the Pinch ofEscalating Health Care CostsWhy is it difficult for people who areseriously ill to buy health insurance?205Figure 7.1: The Average Height ofAdult MalesFigure 7.3, Sources of HealthInsurancen/aNEW: How Much Will You Pay for HealthInsurance?NEW: Is Your Take-Home Pay Affected by WhatYour Employer Spends on Your ��217217Solved Problem 7.3: Dealing withAdverse Selectionn/a218222Now Figure 7.2. Figure converted from a pie chartto bar graphs.NEW Solved Problem 7.3: If You Are Young andHealthy, Should You Buy Health Insurance?Moved to 5e IMNEW Figure 7.4, “The Effect of a PositiveExternality on the Market for Vaccinations” plusanalysis.NEW Making the Connection: Are U.S. FirmsHandicapped by Paying for Their Employees’Health Insurance (previously in Chapter 17).Includes a demand and supply graph. 2015 Pearson Education, Inc.
Preface4e page227230–2314e ContentMaking the Connection: HealthExchanges, Small Businesses, andRising Medical CostsInside Look: Health Care SpendingExpected to Increase 70 Percent byEnd of Decade5e page5e Content225NEW Figure 7.8, “The Effect of the Third-PartyPayer System on the Demand for MedicalServices” plus analysis.Moved to 5e IMn/an/axiSee MyEconLab for current news articles,summaries, and questions.Chapter 8: Firms, the Stock Market, and Corporate Governance4e page 4e Content5e page 5e Content237240242253256–257How Can You Buy a Piece ofFacebook?Making the Connection: HowImportant Are Small Businesses tothe U.S. EconomySolved Problem 8.2: Does thePrincipal-Agent Problem Apply tothe Relationship between Managersand Employees?237240NEW: Facebook Learns the Benefits and Costs ofBecoming a Publicly Owned FirmNEW graph added to this Making the Connectionn/aMoved to the 5e IM242NEW Solved Problem 8.2: Should a Firm’s CEOAlso Be the Chairman of the Board?CUT.254NEW Making the Connection: The Ups andDowns of Investing in FacebookSee MyEconLab for current news articles,summaries, and questions.Making the Connection: Are Buyersof Facebook Stock Getting a FairDeal?Inside Look: Shares of PrivateCompanies Available to QualifiedInvestorsn/aChapter 9: Comparative Advantage and the Gains from International Trade4e page 4e Content5e page 5e Content273273276291298–299Does the Federal Government’s ‘BuyAmerican’ Policy Help U.S. Firms?Have You Heard of the ‘buyAmerican’ provision?Making the Connection: HowCaterpillar Depends on Internationaltrade271NEW: Saving Jobs in the U.S. Tire Industry?271Have You Heard of the Tariff on Chinese Tires?n/aMoved to 5e IM273NEW Making the Connection: Goodyear and theTire TariffMoved to 5e IM289NEW Making the Connection: The Effect on theEconomy of the Tariff on Chinese Tiresn/aSee MyEconLab for current news articles,summaries, and questions.Making the Connection: Save JobsMaking Hangers and Lose Jobs inDry CleaningInside Look: Did Home DepotKnowingly Defy the “BuyAmerican” Policy? 2015 Pearson Education, Inc.
xiiPrefaceChapter 10: Consumer Choice and Behavioral Economics4e page 4e Content5e page 5e Content309321–322Can Justin Bieber and OzzyOsbourne Get you to Shop at BestBuy?Making the Connection: Why DoFirms Pay Tom Brady to EndorseTheir Products?305NEW: J.C. Penney Learns That SimplifyingPrices Isn’t Simple317–318This content is integrated into a paragraph.326NEW section on The Behavioral Economics ofShoppingNEW Making the Connection: J.C. Penney MeetsBehavioral EconomicsMoved to 5e IM327330332–333Solved Problem 10.4: How Do YouGet People to Save More of TheirIncome?Inside Look: Findings Are Mixed onthe Success of CelebrityEndorsementsSee MyEconLab for current news articles,summaries, and questions.Chapter 11: Technology, Production, and Costs4e page 4e Content5e page353369374–375Sony Uses a Cost Curve toDetermine the Prices of RadiosLong-Run Average Cost Curves forBookstoresInside Look: New Technology CouldLower the Cost of Solar Panels3513675e ContentNEW: Fracking, Marginal Costs, and EnergyPricesRevised to Long-Run Average Cost Curves forAutomobile FactoriesSee MyEconLab for current news articles,summaries, and questions.Chapter 12: Firms in Perfectly Competitive Markets4e page 4e Content5e page5e Content407Moved to 5e IMMaking the Connection LosingMoney in the Medical ScreeningIndustry402–403408–409422–423Solved Problem 12.4: When to Pullthe Plug on a MovieInside Look: Organic Farming on theDecline in the United Kingdom404–405NEW Making the Connection: Losing Money inthe Solar Panel IndustryNEW Solved Problem 12.4: When to Pull thePlug on a MovieSee MyEconLab for current news articles,summaries, and questions.Chapter 13: Monopolistic Competition: The Competitive Model in a More Realistic Setting4e page 4e Content5e page 5eContent444–445Making the Connection: Netflix:Differentiated Enough to Survive?Moved to 5e IM438450–451Inside Look: Starbucks Expands IntoJuice BusinessNEW Making the Connection: Peter Theil, eCigarettes, and the Monopoly in MonopolisticComeptitionSee MyEconLab for current news articles,summaries, and questions. 2015 Pearson Education, Inc.
PrefacexiiiChapter 14: Oligopoly: Firms in Less Competitive Markets4e page 4e Content5e page 5e Content459Competition in the Computer Market465Solved Problem 14.2: Is Advertisinga Prisoner’s Dilemma for Coca-Colaand Pepsi?451Moved to 5e IM447–458475478–479NEW: Competition in the Video Game ConsoleMarketFigure 14.8: Five Competitive ForcesModelInside Look: Can Intel’s “Ultrabook”Compete with Apple’s MacBookAir?NEW Solved Problem 14.2: Is Same-DayDelivery a Prisoner’s Dilemma for Wal-Mart andAmazon?CUTSee MyEconLab for current news articles,summaries, and questions.Chapter 15: Monopoly and Antitrust Policy4e page 4e Content5e page5e Content487487NEW A Monopoly on Lobster Dinners in Maine?Is There a Monopoly in Your Dorm?490494507Is Cable Television a Monopoly?Why Can’t I Watch the NFLNetwork?Making the Connection: The End ofthe Christmas Plant Monopoly477477Moved to 5e IM480–481NEW Making the Connection: Does Hasbro Havea Monopoly on Monopoly?Moved to 5e IM484–485NEW Solved Problem 15.2: Can a Restaurant Bea Natural Monopoly?Solved Problem 15.2: Is theOpenTable Web Site a NaturalMonopoly?Making the Connection: ShouldAT&T Have Been Allowed to Mergewith T-Mobile?Moved to IM494–495510–511Inside Look: The End of the CableTV Monopoly?Chapter 16: Pricing Strategy4e page 4e Content530See MyEconLab for current news articles,summaries, and questions.5e pageMaking the Connection: PriceDiscrimination with a Twist atNetflixInside Look: Paying for the Right toPay to See the Kansas Jayhawks PlayFootball5e ContentMoved to 5e IM518–519538–539NEW Making the Connection: Did Apple Violatethe Law in Pricing e-Books?NEW Making the Connection: The InternetLeaves You Open to Price DiscriminationSee MyEconLab for current news articles,summaries, and questions. 2015 Pearson Education, Inc.
xivPrefaceChapter 17: The Markets for Labor and Other Factors of Production4e page 4e Content5e page 5e Content545559572–573Why Did the San Diego Padres TradeTheir Best Player to the Boston RedSox?Making the Connection: Are U.S.Firms Handicapped for TheirEmployees’ Health InsuranceInside Look: Basketball Coaches’Salaries: A March to Madness?533NEW Who Is Zach Greinke and Why Is He BeingPaid 147 Million?544NEW Making the Connection: Veterinarians FallVictim to Demand and SupplyMoved to Chapter 7, page 222Movedto Ch. 7,p. 222See MyEconLab for current news articles,summaries, and questions.Chapter 18: The Tax System and the Distribution of Income4e page 4e Content5e page 5e Content569606–607Inside Look: Should a Tax on SodaBe used to Reduce Budget Deficits?New Making the Connection: What Explains the 1Percent?See MyEconLab for current news articles,summaries, and questions.Chapter 19: GDP: Measuring Total Production and Income4e page 4e Content5e page 5e Content622Making the Connection: Will U.S.Consumers Be Spending Less?603Moved to 5e IM610–611NEW Making the Connection: Adding More ofLady Gaga to GDPSee MyEconLab for current news articles,summaries, and questions.Chapter 20: Unemployment and Inflation4e page 4e Content5e page5e Content641629NEW Caterpillar Announces Plans to Lay OffWorkerMoved to 5e IMInside Look: Analysts LowerEstimates for New Car Sales in 2011and 2012653–54661NEW Bank of America AnnouncesPlans to Lay Off 30,000 EmployeesMaking the Connection: How ShouldWe Categorize the Unemployment atBank of America?Solved Problem 20.5: CalculatingReal Average Hourly Earnings641–42649668–69Inside Look: Will Pink slips Be in theMail for Postal Workers?NEW Making the Connection: How Should WeCategorize Unemployment at Caterpillar?Moved to 5e IMNEW Solved Problem 20.5: Calculating RealWages at CaterpillarSee MyEconLab for current news articles,summaries, and questions.Chapter 21: Economic Growth, the Financial System, and Business Cycles4e page 4e Content5e page 5e Content677684–85Growth and the Business Cycle atBoeingMaking the Connection: WhatExplains Rapid Economic Growth inBotswana?665NEW Economic Growth and the Business Cycleat WhirlpoolMoved to 5e IM672–73NEW Making the Connection: Can India SustainIts Rapid Growth? 2015 Pearson Education, Inc.
Prefacexv4e page4e Content5e page5e Content697Section on “The Effect of theBusiness Cycle on Boeing”Inside Look: Airlines Face theBusiness Cycle686Replaced with “The Effect of the Business Cycleon Whirlpool”See MyEconLab for current news articles,summaries, and questions.704–705Chapter 22: Long-Run Economic Growth: Sources and Policies4e page 4e Content5e page 5e Content711725Google’s Dilemma in ChinaSection, “Can the United StatesMaintain High Rates of ProductivityGrowth”735Figure 22.10, “Globalization andGrowth”Inside Look: Despite a Plan forChange, Investment Still SpursChina’s Growth740–741699713NEW Can China Save General MotorsHeavily revised and expanded and significantlyexpanded discussion of the debate over futureU.S. growth. Section renamed to “Is the UnitedStates Headed for Another ProductivitySlowdown?”Moved to 5e IMSee MyEconLab for current news articles,summaries, and questions.Chapter 23: Aggregate Expenditure and Output in the Short Run4e page 4e Content5e page 5e Content755762–63Making the Connection: Do Changesin Housing Wealth AffectConsumption SpendingMaking the Connection: Intel Tries toJump Off the Roller Coaster of ITSpending737Moved to 5e IM749–50753782–83Moved to 5e IMInside Look: turnaround Projected forthe Restaurant IndustryNEW Making the Connection: Intel Moves intoTablets and Perceptual ComputingNEW Making the Connection: The iPhone IsMade in China or Is It?See MyEconLab for current news articles,summaries, and questions.Chapter 24: Aggregate Demand and Aggregate Supply Analysis4e page 4e Content5e page 5e Content789–90811818–819826Making the Connection: How LongDoes It Take to Return to PotentialGDP? Economic Forecasts Followingthe Recession of 2007–2009Inside Look: Smaller FreightVolumes Signal continued EconomicTroubles (2011 article)Appendix on MacroeconomicsSchools of ThoughtNEW Making the Connection: How Sticky AreWages?Extensively revised and includes a new tableshowing the errors in government forecasts.See MyEconLab for current news articles,summaries, and questions.814–815Revised to include a new section on the Austrianmodel.Chapter 25: Money, Banks, and the Federal Reserve System4e page 4e Content5e page 5e Content829835Coca-Cola Dries Up as MoneyFloods ZimbabweMaking the Connection: Do We StillNeed the Penny?819NEW Washing Dollar Bills to Save the Economyof ZimbabweMoved to 5e IM 2015 Pearson Education, Inc.
xviPreface4e page4e Content5e page5e Content826–27NEW Making the Connection: Are BitcoinsMoney?NEW T-accounts added to section on “OpenMarket Operations”See MyEconLab for current news articles,summaries, and questions.837–38856–57Inside Look: Increased LendingBoosts Money Supply GrowthChapter 26: Monetary Policy4e page 4e Content5e page5e Content865853NEW Why Do Businesses Care What the FederalReserve Does?NEW Section of “Fed Forecasts” that includesNEW Table 26.1: Fed Forecasts of Real GDPGrowth during 2007 and 2008NEW Figure 26.12: Housing Prices and HousingRentsSee MyEconLab for current news articles,summaries, and questions.Monetary Policy, Toll Brothers, andthe Housing Market866–67896–97Inside Look: Fed Attempts toStimulate Housing Market .AgainChapter 27: Fiscal Policy4e page 4e Content5e page5e Content909–910897–98NEW graph added to this feature thatdistinguishes growth in spending on SocialSecurity from growth in spending onMedicare/Medicaid.Revised for clarity: key Figure 27.9, “TheMultiplier Effect of an Increase in GovernmentPurchases”NEW Figure 27.14: The Effect of the StimulusPackage on Federal Expenditures and RevenueSee MyEconLab for current news articles,summaries, and questions.Making the Connection: Is Spendingon Social Security and Medicare aFiscal Time Bomb904912936–37Inside Look: Obama ProposesAdditional Spending to Stimulate theEconomyChapter 28: Inflation, Unemployment, and Federal Reserve Policy4e page 4e Content5e page 5e Content951Why Does CarMax Worry aboutMonetary Policy?937957974–75Inside Look: Can the Fed Balance theTrade-off between Unemploymentand Inflation?NEW Why Does Parker Hannifin Worry aboutMonetary Policy?NEW Making the Connection: The Debate overQuantitative Easing with photo of Janet YellenSee MyEconLab for current news articles,summaries, and questions.Chapter 29: Macroeconomics in an Open Economy4e page 4e Content5e page5e Content933Moved to 5e IMMaking the Connection: WhatExplains the Fall and Rise and Fall ofthe Dollar977–781004–5Inside Look: Struggling EconomyContributes to a Weak DollarNEW Making the Connection: Japanese FirmsRide the Yen Roller CoasterSee MyEconLab for current news articles,summaries, and questions. 2015 Pearson Education, Inc.
PrefaceChapter 30: The International Financial System4e page 4e Content5e page101310161026–271030–31Airbus Deals with FluctuatingExchange RatesMaking the Connection: TheCanadian Province of Arizona5e Content995NEW Volkswagen Deals with FluctuatingExchange RatesMoved to the 5e IM1007NEW Figure 30.5 The Yuan-Dollar ExchangeRateMoved to the 5e IM1008–9NEW Making the Connection: Why Did IcelandRecover So Quickly from the Financial Crisis?See MyEconLab for current news articles,summaries, and questions.Making the Connection: Crisis andRecovery in South KoreaInside Look: Can Tariffs Offset theEffect of Overvaluation? (October2011 article)xviiOrganizing Your SyllabusThe Instructor’s Manual can be a valuable resource for both experienced and first-time instructors. Boththe textbook and Instructor’s Manual provide comprehensive coverage of economic theory, monetarypolicy, fiscal policy, and real-world applications.Microeconomic ChaptersThe microeconomics chapters cover relatively new developments in the field, such as the economics ofinformation (Chapter 7, “The Economics of Health Care”) and personnel economics (Chapter 17, “TheMarkets for Labor and Other Factors of Production”). The authors include business applications in eachchapter and have a dedicated chapter on firms, the stock market, and corporate governance (Chapter 8,“Firms, the Stock Market, and Corporate Governance”). The comprehensive coverage of microeconomicsand business topics allows instructors to select chapters for diverse groups of students.Most instructors will not want to cover indifference curve analysis or isoquant and isocost curves, butthose who wish to will find these topics covered in the appendices to Chapter 10, “Consumer Choice andBehavioral Economics,” and Chapter 11, “Technology, Production, and Costs,” respectively. Chapter 14of this instructor’s manual, “Oligopoly: Firms in Less Competitive Markets,” includes coverage of thekinked demand curve that does not appear in the main book.First-time users of the textbook should be aware that some topics introduced in one chapter are applied ina later chapter. Chapter 4, “Economic Efficiency, Government Price Setting, and Taxes,” introducesconsumer, producer, and economic surplus to describe the impact of government-imposed price controls.The appendix to Chapter 4, “Quantitative Demand and Supply Analysis,” explains in detail howconsumer and producer surplus are calculated using linear demand and supply curves. Chapter 9,“Comparative Advantage and the Gains from International Trade,” uses the same tools to measure theeffect of tariffs and quotas on international trade.Macroeconomic ChaptersChapter 19, “GDP: Measuring Total Production and Income,” and Chapter 20, “Unemployment andInflation” carefully provide definitions of macroeconomic statistics such as GDP, CPI, and payrollemployment, that dominate news headlines. 2015 Pearson Education, Inc.
xviii PrefaceThe comprehensive coverage of macroeconomic models and policy issues allows instructors withsomewhat different course objectives the flexibility to choose different chapter sequences. The authorsprovide an overview of issues of long-run growth, business cycles, and the financial system inChapter 21, “Economic Growth, the Financial System, and Business Cycles.” Instructors who wish toexplore more deeply the sources of long-run growth and government policies toward growth can alsoassign Chapter 22, “Long-Run Economic Growth: Sources and Policies.” Monetary policy has a centralrole in the economy, so the book includes two chapters on monetary policy: Chapter 26, “MonetaryPolicy,” and Chapter 28, “Inflation, Unemployment, and Federal Reserve Policy.” Chapter 28 discussesthe role of the Fed and inflation targeting with an insider’s perspective.Chapter 23, “Aggregate Expenditure and Output in the Short Run,” contains a thorough discussion of thetraditional Keynesian 45º-line aggregate expenditure model. Many instructors find thi
If you used Hubbard/O'Brien, Economics, fourth edition, here are a summary of the new digital assets available and a Transition Guide, with page numbers, that shows the changes the authors made to the main text. Knowing about these changes will help you revise your current teaching notes and class presentations.
